Leo Burnett and the MacManus Group both say they will now go it alone in building global media strength following the collapse last week of merger talks involving their media operations.
Combining its Starcom Media Services unit with MacManus' TeleVest would have met Burnett's goal of media dominance in Europe, but the agency also wants to add buying clout in Latin America and Asia, according to insiders. It has been establishing the Starcom operation in several overseas markets and will continue to do so. It may strike alliances in specific markets where it feels the need to bulk up its media clout, sources said, but finding another potential global media partner would be difficult.
Burnett has had talks with Tokyo's Dentsu in recent months, according to sources, and there are media synergies the two could explore. Like MacManus, Dentsu works for Procter & Gamble, and it also handles Burnett client McDonald's in Japan. But as Burnett and MacManus discovered, combinations that are appealing on paper can be difficult to achieve in practical terms.
A Burnett representative would say only that the shop has talked with "any number" of agencies on a range of topics. Dentsu officials could not be reached for comment.
MacManus indicated it will forge ahead with its original plan to develop a global media organization encompassing buying and planning operations from TeleVest, D'Arcy Masius Benton & Bowles and N.W. Ayer & Partners. MacManus intends to launch the new media operation in January.
Going it alone would allow both agencies to pursue their different organizational structures, which insiders said proved to be the insurmountable barriers to their merger, especially in the U.S. Media buying and planning are integrated at Starcom, and its approximately $3 billion in U.S. billings are spread among broadcast, print and out-of-home media. Similarly sized TeleVest handles buying only, predominantly in broadcast. That organizational difference, and not any client conflict, was the sharpest sticking point, sources said.
"You had an integrated media agency and a single-service buying agency, both very good at what they do. Ultimately, a way to combine them just couldn't be found," said one source close to the negotiations.
--with David Kilbur